Correlation Between Sligro Food and SunLink Health
Can any of the company-specific risk be diversified away by investing in both Sligro Food and SunLink Health at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Sligro Food and SunLink Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sligro Food Group and SunLink Health Systems, you can compare the effects of market volatilities on Sligro Food and SunLink Health and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Sligro Food with a short position of SunLink Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sligro Food and SunLink Health.
Diversification Opportunities for Sligro Food and SunLink Health
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sligro and SunLink is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Sligro Food Group and SunLink Health Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunLink Health Systems and Sligro Food is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Sligro Food Group are associated (or correlated) with SunLink Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunLink Health Systems has no effect on the direction of Sligro Food i.e., Sligro Food and SunLink Health go up and down completely randomly.
Pair Corralation between Sligro Food and SunLink Health
Assuming the 90 days horizon Sligro Food Group is expected to generate 0.67 times more return on investment than SunLink Health. However, Sligro Food Group is 1.49 times less risky than SunLink Health. It trades about -0.21 of its potential returns per unit of risk. SunLink Health Systems is currently generating about -0.16 per unit of risk. If you would invest 1,366 in Sligro Food Group on August 30, 2024 and sell it today you would lose (166.00) from holding Sligro Food Group or give up 12.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Sligro Food Group vs. SunLink Health Systems
Performance |
| Timeline |
| Sligro Food Group |
| SunLink Health Systems |
Sligro Food and SunLink Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sligro Food and SunLink Health
The main advantage of trading using opposite Sligro Food and SunLink Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sligro Food position performs unexpectedly, SunLink Health can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in SunLink Health will offset losses from the drop in SunLink Health's long position.| Sligro Food vs. Avient Corp | Sligro Food vs. Braskem SA Class | Sligro Food vs. Kite Realty Group | Sligro Food vs. Axalta Coating Systems |
| SunLink Health vs. Humana Inc | SunLink Health vs. Cigna Corp | SunLink Health vs. Elevance Health | SunLink Health vs. Centene Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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